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Illumina(ILMN) - 2025 Q2 - Earnings Call Transcript
2025-07-31 21:30
Financial Data and Key Metrics Changes - In Q2 2025, the company reported revenue of approximately $1,060 million, reflecting a year-over-year decline of about 3% on both constant currency and reported basis [20][21] - Non-GAAP operating margin was 23.8%, an increase of 160 basis points year-over-year, while non-GAAP EPS was $1.19, growing 9% year-over-year and exceeding guidance [5][28][29] - Non-GAAP gross margin was 69.4%, stable year-over-year, with a favorable product mix contributing to improved performance [27] Business Line Data and Key Metrics Changes - Sequencing consumables revenue was approximately flat year-over-year at $740 million, with high throughput consumables showing over 10% sequential growth [21][22] - The transition to the NovaSeq X platform is progressing, with over 80% of sequencing volumes for research customers already transitioned, and clinical customers at approximately 55% [22] - Sequencing instruments revenue was down approximately 18% year-over-year, primarily due to budget constraints from research customers [24] Market Data and Key Metrics Changes - Clinical markets now account for roughly 60% of total sequencing consumables, driven by comprehensive genomic profiling and sequencing-intensive applications [5][21] - Greater China revenue was $63 million, slightly ahead of expectations but down $12 million from 2024, with ongoing discussions with regulators regarding export restrictions [20][32] Company Strategy and Development Direction - The company aims for high single-digit revenue growth and to expand non-GAAP operating margin to 26% by 2027, focusing on growing the core sequencing business and expanding services [9][31] - The acquisition of Somologic for $350 million is expected to enhance the company's capabilities in proteomics, integrating it into their multiomics strategy [30][12] Management's Comments on Operating Environment and Future Outlook - Management expressed caution for the second half of 2025 due to ongoing funding uncertainties in the U.S. research market, despite raising guidance for total company revenue growth [16][17] - The clinical segment is expected to continue driving growth, with significant opportunities in oncology and genetic disease testing [80] Other Important Information - The company repurchased approximately 4.5 million shares for $380 million, with plans to continue share repurchases throughout the year [29][30] - The company ended the quarter with approximately $1,160 million in cash and equivalents, maintaining a gross leverage of approximately 1.7x [30] Q&A Session Summary Question: Guidance change and its components - The guidance increase was attributed to FX and increased expectations for consumables, while instrumentation expectations were reduced due to research market constraints [40][44] Question: Customer behavior in anticipation of competition - The company focuses on customer engagement and innovation to remain competitive, with ongoing efforts to understand customer needs [48][50] Question: Pull forward in customer orders - No significant pull forward was observed in Q2, with a normal quarter reported; however, increased backlog was noted for future orders [56][57] Question: Clinical customer spending patterns - Clinical customers are expected to continue investing in expanding their portfolios, with a gradual transition to the NovaSeq X platform [78][82] Question: Trajectory of X placements - The company anticipates continued placements of NovaSeq X instruments, with expectations of 50-60 placements per quarter [90]
Illumina(ILMN) - 2025 Q2 - Earnings Call Presentation
2025-07-31 20:30
Q2 2025 Financial Performance - Illumina's Q2 2025 revenue reached $1.06 billion, a decrease of 3% year-over-year (YoY) on both a constant currency (CC) and reported basis[7] - The non-GAAP operating margin for Q2 2025 was 23.8%[7] - Non-GAAP diluted earnings per share (EPS) for Q2 2025 stood at $1.19[7] Regional Revenue Performance - Americas region generated $586 million in revenue, a decrease of 5% YoY CC and 6% YoY reported[7] - Europe's revenue was $310 million, an increase of 6% YoY CC and 7% YoY reported[7] - Asia Pacific, Middle East, and Africa (AMEA) region contributed $100 million, a decrease of 14% YoY CC and 15% YoY reported[7] - Greater China's revenue was $63 million, a decrease of 14% YoY CC and 15% YoY reported[7] NovaSeq X Transition - NovaSeq X accounted for over 50% of high-throughput (HT) revenue and over 75% of HT Gigabases (Gb) shipped in Q2 2025[22] - NovaSeq X consumables revenue is targeted to represent approximately 50% of HT revenue by the end of 2025[22] - NovaSeq X is targeted to represent approximately 75% of HT Gb shipped towards the end of 2025[22] Acquisition of SomaLogic - Illumina announced the acquisition of SomaLogic for $350 million in cash, payable at closing, with up to $75 million in near-term revenue performance-based milestones and potential performance-based royalties[15] - The acquisition is projected to close in the first half of 2026, pending regulatory clearance[14] - SomaLogic is expected to become profitable in 2027 on a non-GAAP operating income basis, with non-GAAP operating margins aligning with Illumina's in 2028[15] Financial Guidance - Illumina's FY25 revenue guidance indicates a growth of 0% to 2%, with an FX benefit of approximately 20 bps for the rest of the world, and a revenue between $190 million and $210 million for Greater China[35] - Q3 2025 revenue guidance indicates a decline of 2.5% to 1.5%, with an FX benefit of approximately 60 bps, implying a reported revenue of $1.06 billion to $1.07 billion[35]
Illumina(ILMN) - 2026 Q2 - Quarterly Results
2025-07-31 20:11
[Financial Highlights and Outlook](index=1&type=section&id=Financial%20Highlights%20and%20Outlook) Illumina reports strong Q2 2025 results exceeding guidance and raises its full-year 2025 financial outlook [Second Quarter 2025 Performance](index=1&type=section&id=Second%20Quarter%202025%20Performance) Illumina reported second-quarter 2025 results that exceeded guidance, despite a 3% year-over-year revenue decline to $1.06 billion, driven by strong X consumables sales and clinical segment growth, achieving GAAP operating margin of 20.2% and non-GAAP operating margin of 23.8% - CEO Jacob Thaysen highlighted that results exceeded guidance, driven by the ramp in X consumables and accelerating growth in the clinical customer segment, with a focus on operational excellence leading to margin expansion[3](index=3&type=chunk) Core Illumina Q2 2025 Financial Results (GAAP vs. Non-GAAP) | Dollars in millions, except per share amounts | Q2 2025 (GAAP) | Q2 2024 (GAAP) | Q2 2025 (Non-GAAP) | Q2 2024 (Non-GAAP) | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | $1,059 | $1,092 | $1,059 | $1,092 | | **Gross Margin** | 65.6% | 68.0% | 69.4% | 69.4% | | **Operating Profit** | $214 | $442 | $252 | $242 | | **Operating Margin** | 20.2% | 40.5% | 23.8% | 22.2% | | **Net Income** | $235 | $66 | $187 | $174 | | **Diluted EPS** | $1.49 | $0.41 | $1.19 | $1.09 | - Total revenue for Q2 2025 was **$1.06 billion**, representing a **3% decrease** from Q2 2024 on both a reported and constant currency basis[5](index=5&type=chunk) Q2 2025 Cash Flow Summary | Metric | Amount (in millions) | | :--- | :--- | | Cash provided by operations | $234 | | Capital expenditures | $30 | | Free cash flow | $204 | [Fiscal Year 2025 Outlook](index=1&type=section&id=Fiscal%20Year%202025%20Outlook) The company raised its full-year 2025 guidance, now expecting a constant currency revenue decline between 0.5% and 2.5%, with non-GAAP operating margin projected at 22% to 22.5% and non-GAAP diluted EPS forecasted in the range of $4.45 to $4.55 Updated Fiscal Year 2025 Guidance | Metric | Previous Guidance | Updated Guidance | | :--- | :--- | :--- | | Total company constant currency revenue decline | (3%) to (1%) | (2.5%) to (0.5%) | | Non-GAAP operating margin | 21.5% - 22.0% | 22.0% - 22.5% | | Non-GAAP diluted EPS | $4.20 - $4.30 | $4.45 - $4.55 | - The increase in the non-GAAP diluted EPS forecast includes an approximate **$0.10 benefit** from recent legislation allowing U.S.-based R&D spending to be tax-deductible[5](index=5&type=chunk) [Capital Allocation and Strategic Initiatives](index=1&type=section&id=Capital%20Allocation%20and%20Strategic%20Initiatives) The company executed significant share repurchases and advanced strategic growth through a key acquisition and new product launches [Capital Allocation](index=1&type=section&id=Capital%20Allocation) During the second quarter, Illumina repurchased 4.5 million shares for $380 million, with approximately $800 million remaining under its current share repurchase authorization, and plans to continue repurchases throughout the year - In Q2 2025, the company repurchased approximately **4.5 million shares** of its stock for **$380 million**, at an average price of **$84.66 per share**[5](index=5&type=chunk)[7](index=7&type=chunk) - The company has approximately **$800 million remaining** in its share repurchase authorization at the end of the quarter and intends to repurchase more shares over the course of the year[7](index=7&type=chunk) [Strategic and Operational Highlights](index=1&type=section&id=Strategic%20and%20Operational%20Highlights) Key strategic developments include entering a definitive agreement to acquire SomaLogic, expected to close in the first half of 2026, alongside launching new products like TruSight Oncology 500 v2, PromoterAI, and DRAGEN v4.4 software, and receiving regulatory approval in Japan for its TSO Comprehensive assay - Entered into a definitive agreement to acquire SomaLogic from Standard BioTools, with the transaction expected to close in the **first half of 2026**, pending regulatory approval[5](index=5&type=chunk)[13](index=13&type=chunk) - Recent product and technology launches include: - TruSight Oncology 500 version 2 (TSO 500 v2) for cancer research - PromoterAI, a new AI algorithm for deciphering pathogenic genetic variants - DRAGEN™ v4.4 software for secondary analysis in oncology and multiomics[13](index=13&type=chunk) - Received approval from Japan's Ministry of Health, Labour and Welfare (MHLW) for TruSight™ Oncology (TSO) Comprehensive as a Class III/IV Medical Device[13](index=13&type=chunk) [Consolidated Financial Statements](index=5&type=section&id=Consolidated%20Financial%20Statements) This section presents the company's condensed consolidated balance sheets, statements of operations, and cash flows for the reported periods [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 29, 2025, Illumina's total assets were $6.09 billion, a decrease from $6.30 billion at the end of fiscal 2024, primarily due to reduced cash and cash equivalents, while total liabilities decreased to $3.83 billion and stockholders' equity fell to $2.26 billion Condensed Consolidated Balance Sheets (in millions) | | June 29, 2025 | December 29, 2024 | | :--- | :--- | :--- | | **Total current assets** | $2,641 | $2,746 | | **Total assets** | $6,087 | $6,303 | | **Total current liabilities** | $1,461 | $1,547 | | **Total liabilities** | $3,829 | $3,930 | | **Stockholders' equity** | $2,258 | $2,373 | | **Total liabilities and stockholders' equity** | $6,087 | $6,303 | - Cash and cash equivalents decreased from **$1.127 billion** at the end of 2024 to **$934 million** at the end of Q2 2025[19](index=19&type=chunk) [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended June 29, 2025, Illumina reported total revenue of $1.06 billion and a net income of $235 million, or $1.49 per diluted share, a significant turnaround from a $1.99 billion net loss in the prior-year period primarily due to a large goodwill and intangible impairment charge related to GRAIL Condensed Consolidated Statements of Operations (in millions, except per share amounts) | | Three Months Ended June 29, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Total revenue** | $1,059 | $1,112 | | **Gross profit** | $695 | $721 | | **Income (loss) from operations** | $214 | $(1,637) | | **Net income (loss)** | $235 | $(1,988) | | **Diluted earnings (loss) per share** | $1.49 | $(12.48) | - The results for Q2 2024 and YTD 2024 included the results for GRAIL, which was spun off on June 24, 2024, with Q2 2024 results heavily impacted by a **$1.886 billion goodwill and intangible impairment charge**[21](index=21&type=chunk) [Condensed Statements of Cash Flows](index=7&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) In Q2 2025, net cash provided by operating activities was $234 million, a significant increase from $80 million in the prior-year period, resulting in $204 million in free cash flow after capital expenditures, while net cash used in financing activities was $371 million, largely due to share repurchases Consolidated Statements of Cash Flows and Free Cash Flow (in millions) | | Three Months Ended June 29, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $234 | $80 | | **Net cash used in investing activities** | $(49) | $(41) | | **Net cash used in financing activities** | $(371) | $(225) | | **Net decrease in cash and cash equivalents** | $(179) | $(188) | | **Free cash flow** | $204 | $48 | - Core Illumina's free cash flow was **$204 million** in Q2 2025, compared to **$213 million** in the prior year period, showing more stability when excluding the impact of GRAIL in the prior year[25](index=25&type=chunk) [Supplemental Financial Information (Non-GAAP)](index=8&type=section&id=Supplemental%20Financial%20Information%20(Non-GAAP)) This section provides supplemental non-GAAP financial measures, including constant currency revenue and reconciliations to GAAP results [Constant Currency Revenue](index=8&type=section&id=Constant%20Currency%20Revenue) On a constant currency basis, Core Illumina's revenue for Q2 2025 was $1.054 billion, representing a 3% decline compared to the prior year, with six-month constant currency revenue at $2.104 billion, a 2% year-over-year decline, adjusting for foreign exchange rate fluctuations and hedging Core Illumina - Constant Currency Revenue (in millions) | | Three Months Ended | % Change | Six Months Ended | % Change | | :--- | :--- | :--- | :--- | :--- | | **Reported Revenue (Q2 2025 vs Q2 2024)** | $1,059 vs $1,092 | (3)% | $2,100 vs $2,148 | (2)% | | **Constant Currency Revenue (Q2 2025 vs Q2 2024)** | $1,054 vs $1,088 | (3)% | $2,104 vs $2,141 | (2)% | [Reconciliation of GAAP to Non-GAAP Measures](index=9&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures) The company provides detailed reconciliations of its GAAP to non-GAAP results, with Q2 2025 non-GAAP diluted EPS at $1.19 compared to GAAP diluted EPS of $1.49, primarily adjusted for acquisition-related costs, intangible impairments, and strategic investment gains, resulting in non-GAAP operating profit of $252 million Q2 2025 Reconciliation of GAAP and Non-GAAP Diluted EPS | | Amount per share | | :--- | :--- | | **GAAP diluted earnings per share** | $1.49 | | Cost of revenue adjustments | $0.25 | | R&D expense adjustments | $0.03 | | SG&A expense adjustments | $(0.04) | | Other (income) expense, net adjustments | $(0.65) | | Provision for income taxes adjustments | $0.11 | | **Non-GAAP diluted earnings per share** | $1.19 | Q2 2025 Reconciliation of GAAP and Non-GAAP Operating Profit (in millions) | | Amount | | :--- | :--- | | **GAAP operating profit** | $214 | | Cost of revenue adjustments | $40 | | R&D costs adjustments | $4 | | SG&A costs adjustments | $(6) | | **Non-GAAP operating profit** | $252 | - Key adjustments between GAAP and Non-GAAP results for Q2 2025 include **$16 million** for amortization of intangible assets, a **$23 million intangible asset impairment**, and a **$102 million net gain** on strategic investments[34](index=34&type=chunk)[39](index=39&type=chunk) [Disclosures](index=3&type=section&id=Disclosures) This section outlines the company's use of non-GAAP financial measures and provides forward-looking statements with associated risk factors [Use of Non-GAAP Financial Measures](index=3&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) The company explains its use of non-GAAP financial measures as supplementary to GAAP, believing these metrics, which exclude items like amortization of acquired intangibles and currency effects, help investors better assess operating performance and are used by the board to evaluate management performance and determine compensation - Management excludes certain items in non-GAAP measures to assist investors in analyzing and assessing past and future operating performance[14](index=14&type=chunk) - Non-GAAP metrics are key components used by the company's board of directors to measure management's performance and determine significant elements of their compensation[14](index=14&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section contains a standard safe harbor statement, warning that actual results could differ materially from forward-looking statements due to various risk factors, including market growth changes, the ability to complete and integrate the SomaLogic acquisition, regulatory uncertainty in China, potential tariffs, and challenges in launching new products - Key risks that could cause actual results to differ from projections include: - The ability to complete and integrate the proposed acquisition of SomaLogic - Uncertainty regarding the impact of being on China's "unreliable entities list" and export restrictions - Tariffs and other trade protection measures - Challenges inherent in developing and launching new products and services[16](index=16&type=chunk)
Illumina (ILMN) Earnings Expected to Grow: What to Know Ahead of Next Week's Release
ZACKS· 2025-07-24 15:07
Core Viewpoint - The market anticipates Illumina (ILMN) to report a year-over-year increase in earnings despite lower revenues for the quarter ended June 2025, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - Illumina is expected to post quarterly earnings of $1.02 per share, reflecting a year-over-year increase of +183.3% [3]. - Revenue projections stand at $1.05 billion, indicating a decline of 5.8% from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised down by 0.15% over the last 30 days, indicating a reassessment by analysts [4]. - The Most Accurate Estimate for Illumina is higher than the Zacks Consensus Estimate, resulting in an Earnings ESP of +1.10% [12]. Earnings Surprise Prediction - A positive Earnings ESP is a strong indicator of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [10]. - Illumina currently holds a Zacks Rank of 3, suggesting a likelihood of beating the consensus EPS estimate [12]. Historical Performance - In the last reported quarter, Illumina exceeded the expected earnings of $0.96 per share by reporting $0.97, achieving a surprise of +1.04% [13]. - Over the past four quarters, Illumina has surpassed consensus EPS estimates three times [14]. Industry Context - Another company in the biomedical and genetics sector, Wave Life Sciences (WVE), is expected to report a loss of $0.28 per share, reflecting a year-over-year change of -12% [18]. - Wave Life Sciences anticipates revenues of $12.64 million, down 35.8% from the previous year, with an Earnings ESP of +4.85% despite a Zacks Rank of 4 (Sell) [19][20].
TD Cowen将因美纳目标价从89美元上调至106美元
news flash· 2025-07-16 12:09
TD Cowen将因美纳目标价从89美元上调至106美元。 ...
HRMY vs. ILMN: Which Stock Should Value Investors Buy Now?
ZACKS· 2025-07-15 16:41
Investors interested in stocks from the Medical - Biomedical and Genetics sector have probably already heard of Harmony Biosciences Holdings, Inc. (HRMY) and Illumina (ILMN) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estima ...
Illumina: Higher Profit Margin Despite GRAIL Divestiture And Macroeconomic Headwinds
Seeking Alpha· 2025-07-12 07:46
Group 1 - Illumina is rated as a Buy, presenting an interesting investment opportunity due to market overreaction to its divestiture of GRAIL [1] - The stock price of Illumina has decreased following the divestiture, indicating potential for recovery [1] Group 2 - The analyst has no current stock or derivative positions in any mentioned companies and does not plan to initiate any within the next 72 hours [2] - The article reflects the author's own opinions and is not influenced by compensation from any company [2]
Illumina to Announce Second Quarter 2025 Financial Results on Thursday, July 31, 2025
Prnewswire· 2025-07-10 20:05
Core Points - Illumina, Inc. will release its second quarter 2025 financial results on July 31, 2025, after market close [1] - A conference call will be held on the same day at 1:30 pm Pacific Time to discuss the results [1][2] - The call will be accessible via a live webcast on Illumina's website [2] - A replay of the conference call will be available on Illumina's website for at least 30 days after the event [3] Company Overview - Illumina is a leader in DNA sequencing and array-based technologies, focusing on improving human health through genomic advancements [4] - The company serves various markets including life sciences, oncology, reproductive health, and agriculture [4] - Illumina emphasizes innovation to maintain its position in the global market [4]
Illumina named to TIME's World's Most Sustainable Companies list for the second consecutive year
Prnewswire· 2025-07-10 13:15
Core Insights - Illumina has been recognized for its leadership in sustainability and as an employer of choice, receiving awards from TIME and U.S. News & World Report [1][3][6] Sustainability Commitment - Illumina ranked second in the U.S. and third globally in the Pharmaceuticals & Biotechnology Industry for sustainability, evaluated on over 20 key performance indicators related to ESG practices [3] - The company reported an 80% reduction in packaging since 2019 and has achieved 100% renewable electricity consumption for three consecutive years [4] - The launch of the MiSeq i100 Series sequencer features 85% less packaging and a 35% lower carbon footprint compared to the original MiSeq System [5][9] Employee Experience Commitment - U.S. News & World Report evaluated over 5000 companies based on metrics such as pay quality, work-life balance, and career opportunities to determine the Best Companies to Work For [6] - This marks the third consecutive year that Illumina has been recognized on the Best Companies to Work For list, highlighting the dedication of its employees [7][8]
3 Promising Genomics Stocks to Keep an Eye On in 2025
ZACKS· 2025-06-27 13:06
Industry Overview - The field of genomics has rapidly evolved over the past decade, focusing on the complete set of genes and their interactions rather than individual genes [1] - Genomics is pivotal for developing targeted therapies, leading to a revolutionary era in genetic medicine, attracting significant attention from pharmaceutical and biotech companies [2] Technological Innovations - Synthetic biology, which applies engineering principles to biology, has emerged as a key concept within genomics, aiding in drug discovery, disease detection, and gene editing [3] - The cost, accuracy, and time required to map an individual's genome have drastically reduced, enhancing the spotlight on genomics companies [4] Market Potential - The genomics market is projected to reach $157.47 billion by 2033, while the global synthetic biology market was valued at $16.22 billion in 2024, with a projected CAGR of 17.30% from 2025 to 2030 [6] Company Highlights - MeiraGTx Holdings plc is focused on genetic medicine with a pipeline addressing conditions like Parkinson's disease and retinal dystrophy, showing promising efficacy data [8][9] - Beam Therapeutics is advancing base editing programs for genetic diseases, with FDA orphan drug designation for its BEAM-101 treatment for sickle cell disease [12][13] - Krystal Biotech received FDA approval for Vyjuvek, the first gene therapy for dystrophic epidermolysis bullosa, and is advancing a pipeline in various therapeutic areas [14][15]